Bangladesh's social protection programs represent a dedication to the welfare of its most vulnerable citizens in the midst of persistent economic turmoil. These programs, which are frequently seen as a key tool in fiscal policy, have the power to lower poverty and inequality, balance consumption, and, by increasing aggregate demand, promote economic growth.
Although social safety net programs are intended to reduce social and economic risks, their funding has declined rather than rising to the challenge. In the fiscal year 2023–24, the %age of the budget that was allotted to these crucial programs has decreased from 16.75% (2.55% of GDP) for the fiscal year 2022–23 to 16.58% (2.52% of GDP).
It's a paradox, and it begs the question: Is the government truly committed to shielding its citizens from the harsh realities of poverty and vulnerability?
There are other reasons to be concerned about this. Even with the allocated funds, there is a worrying leak, with up to 60% going to those who do not have immediate needs. On paper, the staggering Tk126,272 crore may appear to be a sizable investment in social safety nets, but in practice, things are much less reassuring.
A major portion, or about 22%, is ostensibly used as a pension fund for government employees, while another Tk 11,217 crore is used to pay interest on national savings certificates. Although the government claims that 2.52 % of the GDP goes to the poor, in reality, only a tiny 1.01 % of the GDP actually reaches this group.
As we delve deeper into these unsettling fiscal discrepancies, it becomes clear that they underscore a pressing issue: The effectiveness and equity of Bangladesh's social safety net programs. Consequently, fewer destitute citizens will benefit from these social safety nets, and even those fortunate enough to receive assistance will find their lifelines fraying, inadequate to address their pressing needs.
Bangladesh's social safety net programs span a diverse landscape, falling into four overarching categories:
(i) special allowances designed for various underprivileged segments of the population;
(ii) initiatives promoting employment generation through microcredit and assorted fund management programs;
(iii) endeavours geared towards bolstering food security and disaster resilience; and
(iv) provisions for education, health, and training to empower the new generation with competence and self-reliance.
As we examine the intricacies of these programs, it becomes evident that their effectiveness in alleviating poverty faces formidable challenges.
Funding
One of the most significant barriers to the success of social protection programs is the issue of funding. Experts consistently highlight the government's failure to allocate adequate funds for these critical safety nets.
A concerning trend has emerged, where some programs that do not genuinely qualify as social safety nets are labeled as such, seemingly to inflate the overall allocation in these sectors.
For instance, in the fiscal year 2023-24, the budget for social safety net programs is set to see only a marginal increase. Allowances in certain programs will rise by a mere Tk 50 to 100, even though the government has decided to raise the allowance after a seven-year hiatus. These per-capita allowances fall far short of meeting basic living needs.
However, beneficiary selection procedures have also shown to be problematic, making the social security programs' funding problems not the only issue they face.
The chairman and union council members are in charge of choosing beneficiaries, and frequently, they put political factors like securing votes, supporting voter sentiment, and giving preference to kinship ties ahead of actual need.
Recent data make the effects of such biased selection methods very clear. Surprisingly, 59% of recipients do not satisfy the requirements for old age allowance, 23% do not satisfy the landlessness requirements for widow and widower women's allowance, and a startling 56% receive assistance without actually being in need.
Other issues
There are two more pressing issues that require our attention, despite the fact that the difficulties with funding allocation and beneficiary selection continue to undermine the efficacy of social protection programs in Bangladesh.
The first alarming concern that siphons funds away from social protection activities is corruption. Shocking reports of corruption within these programs often make headlines in newspapers. Due to the persistence of corruption, the beneficiaries are not fully benefitted and frequently find themselves on the brink of food insecurity, unable to secure the basic necessities for subsistence.
The other is the predominant rural focus of these programs. As the country experiences an urban transformation, an increasing proportion of the population faces poverty in informal settlements within cities. These urban poor people urgently need specialized assistance to address their particular challenges because they are frequently disregarded by current social protection schemes.
It has become obvious that the challenges and disparities within Bangladesh's social safety net programs are multifaceted and require urgent attention. The effectiveness of these programs also hinges on a coordinated, integrated approach that avoids resource wastage through duplication and ensures that benefits reach those who need them most.
An integrated social safety net policy and a plan of action are needed to overcome these challenges and ensure the successful implementation, monitoring, and evaluation of social protection programs. Coordination between the various implementing agencies must be prioritized if this strategy is to be successful.
Additionally, the social security program shouldn't cover the pensions and interest on savings bonds of government employees because the majority of those who benefit from these two sectors are relatively privileged members of society.
In this evolving landscape of urban transformation, the government must adapt its social protection policies to safeguard the well-being of all its citizens, regardless of their location or social status.
Rafiul Karim is working as the lead of the Poverty, Food Security, and Social Protection Team of Youth Policy Forum and a student of International Relations, University of Dhaka.
